New Home Building Guidelines
When building a new home, it is important for you to educate yourself about the most important components of such a huge project. Some of the critical aspects that you should have an understanding of include the various construction standards and purchasing land. This way, you know what your rights are.
The MPS Supplementing Model Building Codes
The Minimum Property Standards (MPS) is a set of minimum construction standards established for structures that are covered by the HUD housing programs. These buildings include the following:
- New single-family homes
- New multi-family housing
- Healthcare-type facilities
About HUD Minimum Property Standards
The HUD Minimum Property Standards are quite similar to other model building codes, with the exception of the durability requirements set by the former. Homes and housing projects that have been financed by mortgages insured by the FHA are used as the security for these loans. With the lack of durability requirements, the financial risk of the FHA is increased, in cases of default.
Some of what the other model building codes lack in terms of durability requirements include the following:
- Wall Coverings
- Kitchen Cabinets
How HUD MPS Supplement Model Building Codes
With many integral components not having any form of durability standards, it can be quite a risk for the FHA. This is where the HUD Minimum Property Standards come into play.
The MPS have set minimum and basic standards for the above-mentioned structural components, as well as a multitude of other home building materials. These standards ensure FHA-insured homes retain their value in the event that these components detoriate, resulting in degradation.
Being in Compliance with Nationally-Recognized Building Codes
All properties that are FHA-mortgage-insured are required by the HUD to be in compliance with nationally-recognized building codes. They may also be in accordance with a state or a local building code that has been derived from one that is nationally recognized.
In the event that the building is to be constructed in an area of the country where no building codes exist, an authorized HUD Field Office is going to set one before construction is permitted to begin. Again, this code that is to be specified by the office is based on a nationally recognized one.
Buying Land from a Development Firm
Before you start shopping around for a piece of land, it is important that you educate yourself as much as you can about how the land buying process works. You should be aware that lots are often marketed in a variety of ways, such as for retirement homes, for secondary homes, for recreational purposes, or for campsite uses.
One very important thing to keep in mind, though, is to be on the lookout for any emphasis placed by a sales person in terms of the investment aspect on a land. If your lot purchasing plan involves buying a land that is being offered through promotional land sales, you should spend as much time as you could in reviewing the offer before you finalize your decision.
In all cases, you should equip yourself with the knowledge of the following, prior to signing that contract, check, or purchase agreement:
- Your rights as the buyer.
- The history and record of the developer.
- All details about the development.
- All relevant information about the land you want to purchase.
- What you should do in the event that you are faced with a too-persistent sales personnel.
Companies Required to Register with the HUD
You should also know that in most cases, if the seller of the land you want to buy from offers more than 100 unimproved lots, either for lease or for sale, and if they are offered either through the mail or through the interstate commerce, the company may have been required registration with the United States Department of Housing and Urban Development (HUD).
In other words, the seller should have filed with the development agency.
Property Report Provision Requirement
In addition, the company you are going to purchase the land from should provide you and all other potential buyers with a comprehensive property report that includes detailed information regarding the property to be sold. You should know that this is a must, and if the company has failed to provide you with this report, it may already be violating federal laws.
Violation of the federal laws surrounding property sale can lead to a punishment of imprisonment of up to five years. The punishment may also be in the form of a $10,000 fine. There are some cases wherein both are enforced on companies that fail to be in accordance with this rule.
Information Developers Should Present to the HUD
The details that should be filed by the land developer to the HUD should contain the following:
- Corporate charter copy
- A copy of the compan’s financial statement
- Details about the land to be sold, including the title policy or the title opinion of an attorney, a copy of the deed, and a copy of the mortgage contract
- All necessary details about local ordinances and health regulations
- All necessary information about the types of facilities available within the land area, including schools, transportation systems, and medical facilities such as hospitals
- Facts about the availability of water and other utilities
- The company’s plans when it comes to sewage disposal processes
- All the plans for the development of property, which should include details about the roads, the streets, and any recreational facilities
- All supporting documents, including maps, plans, as well as letters and documents from sewer facilities and water suppliers
The company that is responsible for presenting all these pieces of information to the HUD should swear and affirm that they are honest, factual, and complete. The company should also expect to pay an appropriate fee upon submitting the information and registering with the development agency. HUD is then going to retain the information and make it available to the public, so that potential buyers can retrieve and review the information.